Asian private equity battles talent shortage in hottest deal market

[HONG KONG] The barbarians at the gate in Asia are struggling to get the right executives through the door at their takeover targets.

From Japan to India to China, private equity firms in some of the world’s hottest markets are facing headwinds as they try to place experienced managers in the companies they buy.

That is hampering the pace of investments at a time when the amount of dry powder that fund managers have to deploy is climbing again. 

“This war for talent and being able to attract the right people and match the right people, it’s just gonna get harder and harder over time because complexity is increasing,” said Ashish Kotecha, a partner at Boston-based Bain Capital who leads the firm’s private equity portfolio group in Asia.

Buyout firms are riding a strong rebound in fundraising in the region; the 10 largest Asia-focused private equity funds that completed their final closes in the first half of 2026 have raised US$45.5 billion, more than double the comparable total for all of 2025, according to data from Preqin.

But gone are the days when it was enough to acquire a company, lever it up, and sell at a huge margin in an industry that was laid bare by the 1980s book Barbarians at the Gate, about KKR & Co’s pitched battle for RJR Nabisco.

Many private equity firms can no longer count on financial engineering or rising markets to turn a profit.

Delivering above-market returns increasingly hinges on improving the operations and performance of portfolio companies, making recruiting experienced executives more important than before. 

The constrained talent pool in Asia is prompting some firms to pass on deals at early stages due to concerns they will not be able to recruit leaders capable of driving growth.

Delays in building the right management team can quickly undermine an investment’s value, according to several senior executives who asked not to be identified because the deliberations are private. They declined to name the potential investments that were passed over.

As private equity firms pay more for assets, value must be created faster, making executive selection more critical than ever, they said.

Unlike in the US and Europe, where leadership talent can often relocate across markets, Asia requires chief executive officers with deep local expertise and strong market industry relationships, they said.

Many large or fast-growing companies in Asia remain family-led, with key decisions often resting with founders rather than professional managers.

While that entrepreneurial model has produced many success stories, it has also left a relatively shallow bench of executives for hire, according to a lawyer who advises on China deal risk at a US private equity firm.

The estimated pool of executives in India and Australia totals about 4.5 million, compared with 7.5 million in the US and a similar number in Europe.

The shortfall is especially pronounced in healthcare, engineering and education, according to data from Revelio Labs, a New York-based workforce intelligence company.

“There are nuances in Asia,” Bain’s Kotecha said. Markets like India and China are very competitive and you need a CEO who is nimble. In markets like Japan, driving change is tough because it is culturally harder, he said.

India remains the toughest market for industrial companies because the pool of private equity-ready executives is limited.

In China, the challenge is the lack of a proven track record for PE-backed mid-market companies, making those roles less attractive than joining a large company or launching a business.

This also puts smaller Asia-based buyout firms on the back foot against global rivals.

For decades, firms in North America and Europe have been ramping up internal operations teams as well as networks of external “industrial advisers”.

On Wednesday (Jul 22), KKR named Roy Gori, the former CEO of Manulife Financial, as a senior adviser to the firm and its insurance business Global Atlantic, focusing on Asia and international markets.

Getting creative

The executive shortage is forcing some firms to get creative. 

Five years ago, Carlyle Group in Asia would buy a company and then look for a CEO.

Now, its investment committee increasingly wants a top candidate before approving a deal.

Searches take three to four times longer, span multiple countries and involve far more scrutiny.

At the same time, top executives have become choosier, with a fund’s track record now as important as the role itself.

For Amit Jain, managing director and head of Carlyle India Advisors, the search radius has expanded beyond local markets.

For Highway Roop Precision Technologies, an auto components platform it bought in 2025, he recruited Dharmesh Arora from Schaeffler in Singapore after finding that India’s pool of CEO-ready executives in the sector was limited. 

Jain said potential leaders are often identified during pre-deal due diligence. “The ability to get a fit-for-purpose CEO is actually a large part of our investment thesis.”

Other searches have stretched as far as London as many of the strongest leaders for some sectors are founders who rarely leave. Their deputies often lack experience running a business independently, he said.

In addition, the CEO job has become harder: leaders now have to navigate geopolitical shocks, artificial intelligence disruption, supply chain shifts and shorter value-creation timelines.

Compensation has also evolved. Private equity firms typically rely on share-based compensation rather than cash salaries to attract CEOs.

One senior executive accepted a pay cut of 30 per cent to join a Carlyle portfolio company, betting on stock options and the opportunity to create value as an owner, Jain said.

When Blackstone Group’s Amit Dixit needs a boss for one of his portfolio companies fast, he sometimes turns to his own bench. 

A networking group he curated, dubbed Hotel California – a nod to the Eagles song and how operators often take repeat assignments – brings more than 120 current and former CEOs and directors from Blackstone-backed businesses across Asia. 

“In Asia, you exit transactions, you don’t exit relationships,” he said in an interview from his office in India. “One person has transacted with us four times, others three or two times.”

Boosting headcount

Grooming operational expertise started in earnest a quarter century ago, when KKR Capstone launched as a small team focused on increasing the worth of the firm’s corporate investments.

The team now has about 100 people supporting portfolio companies throughout their life cycles. 

KKR also draws on a global network of 140 advisers, a figure that has grown 40 per cent since 2023, bringing its value-creation team to 420 professionals across various divisions.

Those include its global institute, which is led by retired general David Petraeus, a former Central Intelligence Agency, and its global macro and capital markets groups.

The Bain Capital portfolio team has more than 115 people. In Europe, EQT has long relied on a network of some 600 industrial advisers from 43 countries with similar goals. Blackstone’s operating team now comprises about 435 people.

Executives from multinational firms are sometimes drawn to private equity because they have the chance to build a company and leave a legacy, rather than being defined by a corporate brand, Carlyle’s Jain said.

Private equity firms are increasingly casting their nets across borders.

Bain Capital-backed EcoCeres, a renewable fuel company in Hong Kong, appointed veteran Finnish executive Matti Lievonen as CEO last year.

In Japan, Bain installed aerospace veteran Kate Schaefer as executive chair of Jamco.

KKR imported overseas expertise to South Korea’s Samhwa by appointing former L’Oréal North America president Sanford Browne to its board last year.

EQT of Sweden is tackling Asia’s talent shortage by offering executives career paths across its global holdings.

The firm pairs portfolio CEOs with seasoned chairs and deal partners, and rotates leaders through its network using a “spinning wheel” approach. It also adds European and US advisers to Asian boards.

Bettina Siempelkamp, who oversees executive, board and adviser hiring for portfolio firms at EQT, said there are strong senior executives in Asia for hire, but it requires a more prolonged search process.

“The pool is smaller and you just need to look a lot longer,” she said. BLOOMBERG